Business Directories

GCC waste treatment market to hit $2bn

Dubai, December 22, 2011

The water and wastewater treatment equipment market in the Gulf region is set to reach $2 billion by 2016 growing at a compound annual growth rate (CAGR) of 7 per cent over the next five years, according to a report.

The market is currently being pegged at $1.3 billion, said growth partnership company Frost & Sullivan in its latest report.

As economic development gains speed, Middle East governments are moving aggressively towards promoting water conservation/storage, wastewater recycle and reuse and desalination of sea water in order to meet the burgeoning water consumption needs of all sectors, the report stated.

The region has begun investing heavily in water and sewerage networks to ensure 100 per cent connectivity to the growing population, Frost & Sullivan said in the report.

Economically, the GCC region is making brisk developments and is anticipated to be a $2 trillion economy by the year 2020, supplying 25 per cent of the world’s oil.

Contribution of non-oil sectors to the Gross Domestic Product (GDP) is expected to go up from 35 per cent in 2010 to 40 per cent in the year 2020, as economic diversification gains pace.

Such rapid growth is undoubtedly straining the already scarce and stretched water resources in the region, said the report.

Water requirements by all the three sectors - agriculture, domestic and industrial - are set to grow from 35 billion cubic meters (BCM) to 49 BCM by 2020 in the Gulf region, said Frost & Sullivan.

Whilst, the sewage collection rate in the GCC is 52 per cent of the total sewage generated; however, contribution of recycled water to total water withdrawal is between 4 to 8 per cent.

'All the GCC countries were water-stressed with the per capita renewable water resources much below the critical level of 1,000 Cu. M/day,' said its author Sasidhar Chidanamarri, industry manager, Environmental and Building Technologies (Mena) at Frost & Sullivan.

'Over drafting of groundwater aquifers has led to deterioration of groundwater quality, further constraining groundwater supplies,' he noted.

According to him, the GCC region mirrors the trend followed by emerging economies like India, Brazil, and China where upto 80 per cent of the water withdrawals are meant for agricultural purposes.

However, in case of developed economies like the US, industries consume the majority, he pointed out.

The industrial growth in the GCC region, though aimed at de-risking the economy from frequent shocks of oil and gas sector, is expected to unfold opportunities for advanced water and wastewater treatment solutions, said the author.

According to him, desalination is expected to continue playing a critical role in the overall water supply in the Mena region.

Across the Middle East, a total of 39 million Cu. M/day of desalination capacity is expected to be added between 2010 and 2020. This translates into an approximate investment of $45-50 billion in the desalination sector.

The region was facing an uphill task of meeting the growing demand for water by industries, improving water supply and sanitation to the growing population, planning to prevent depletion and contamination along with optimization of available water resources.

In its path towards meeting these challenges, opportunities are unfolding for the water sector particularly in the areas of recycle and reuse technologies such as Membrane Bio Reactor (MBR) and sea water desalination, said the report.

Urbanisation is another mega trend severely impacting the already low levels of available water resources pegged at 1,200 cu m per person/ per year as against the global average being 7,000 cu m per person/ per year, it stated.

In the Middle East, urbanisation levels are about 50 per cent, but the urban growth rate isabout 4 per cent.

Urbanisation levels are expected to touch 70 per cent by the year 2020. Hence, the real challenge lies in continuing economic growth, eradicating poverty and preserving the environment, the report stated.

'Provision of water and wastewater treatment infrastructure is vital to make the Middle Eastern cities viable, livable and competitive, in order to attract foreign investment, increase employment and economic growth,' explained Sasidhar.

Investments in clean technologies and eco-friendly practices through the implementation of advanced treatment technologies not only solve water issues but also promote green growth and sustainable living, he added.

The GCC region is witnessing installations of large capacity MBR plants, said the author.

'Muscat has recently commissioned a 76,000 Cu. M/day MBR plant that treats sewage to low levels of suspended solids, biological oxygen demand and colour, for use in irrigation and other industrial applications.'

These developments are revealing signs of a more expansive market for MBR’s in the Middle East, he stated.

On its outlook for 2012, Frost and Sullivan said Middle East region holds significant potential for industry participants mulling a foray into the development of water and wastewater infrastructure including desalination, water and wastewater treatment, water transmission, and wastewater collection network.

It has the potential to drive the market for membrane-based systems such as reverse osmosis, MBR and ultra-filtration (UF) on the treatment side, the report added.

'Additionally, the countries in the region are keen to allow the private sector to tackle critical water and wastewater issues,' said Sasidhar.

'In its quest for sustainable and green growth, Middle East is expected to be the testing ground for advanced and newer treatment technologies,' he added.-TradeArabia News Service